Trimming back for growth at Kit Heath

Kit Heath chief executive Jeff Lancaster is an adventurer in his personal life and is now trekking into the unknown as he repositions the business. Rachael Taylor quizzes him on closing retail accounts, creating shop in shop furniture, cracking the US and introducing gold to a silver brand.

An adventurer, a wine connoisseur, a restaurant fanatic – all adjectives that fit perfectly to Kit Heath chief executive Jeff Lancaster. But a jewellery expert? Not in the slightest.

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Lancaster fell into jewellery after a returning to the UK from a spell travelling. After a hectic job in the restaurant business that left him with “my phone surgically attached to my hand”, he decided to quit his job, pull his children out of school, grab his wife and “go walkabout for a while”.

The Lancaster family travelled the world spending three months in southern America and three months in Australia with a passport full of stop-offs in places such as Samoa, the US, Mexico and Johannesburg.

When the fun was over and the family returned to Britain, Lancaster reluctantly realised that it was time for a steady job. And for the strikingly self-assured jewellery boss, it never crossed his mind that it would be a challenge to get one.
“I tarted myself about, as you do, and I was offered three jobs within a week,” he boasts. Out of the three it was Kit Heath that caught his eye.

“There was a little bit of nepotism at play,” jokes Lancaster, while sipping a glass of wine. “My wife’s uncle is [Kit Heath’s sister] Katie’s godfather. She hadn’t seen her godfather for 35 years but he was at her wedding and he stepped in as chairman.”

He suggested that Lancaster apply for the role of chief executive at Kit Heath. “I said to him, you don’t want this CV, it’s leisure management,” recalls Lancaster. But it turns out that despite Lancaster’s past career, Kit Heath did want him. So it was time for some market research.

“I went to Croydon and I walked the street looking at jewellers, as I knew nothing about it,” says Lancaster. “I wasn’t approached, nobody helped me, I didn’t understand, and I thought, I can do something about this.”

This scenario took place in 2005, a time when, according to Lancaster, the jewellery industry was just discovering branding and “was a bit confused about what it should be doing”.

Lancaster knew exactly what to do about it. While he hadn’t worked in jewellery before, he believes the principles of creating a restaurant brand, for example, are exactly the same as building a jewellery brand. “It’s very similar,” he says with poise. “It’s all about building consumer confidence, making sure that people trust in your quality and integrity.”

Not being a jeweller allows Lancaster to bring steely business savvy to Kit Heath, something it was perhaps lacking in before. “Kit and Katie are amazing entrepreneurs but when a business has to become a bit more sophisticated entrepreneurs struggle with that, but I can make sense of it,” explains Lancaster. “The business had been developed over 20 years and ways of doing things were hit and miss.”

Lancaster has lots of experience in business, but after 20 years did Kit and Katie struggle to pass over control to a suave new chief executive with no experience of the jewellery trade and a bag full of revolutionary ideas for the brand?

He smiles wryly. “For any entrepreneur there needs to be an establishment of trust and my job is to work with them,” he says. “It took time but it is fantastic now. I saw Katie every day at the start. Now, I see her once a month as they trust me with their business.”

What Kit and Katie are trusting Lancaster to do, he says, is devise a strategy that will ensure the brand is “still around in 10 years and well respected not just in the UK but in the US and internationally”.

Export is a key factor in Kit Heath’s long-term strategy. The brand already has a subsidiary in the US that first started seven years ago and Lancaster hopes to develop this part of the business. He says: “Here we’re known but in the US we have a blank piece of paper. It’s early days.”

In 2010 Kit Heath exhibited at a US trade show for the first time, and Lancaster said it was a steep learning curve. “The US isn’t branded in jewellery,” he says incredulously. “For a country that is at the cutting edge of branding, they are five years behind Europe. You talk to the retailers and they haven’t yet embraced branding.”

Back in the UK market, the brand is already successfully established. Now what it needs, according to Lancaster, is to be repositioned.

He explains: “One of the challenges is that Kit Heath as a wholesaler had never targeted and you could find the brand anywhere. The place for us is the jewellery market, so we’ve had to loose some of the more gift-orientated stockists.”

He stresses that he is not cutting gift shops out of Kit Heath’s distribution plan entirely, it will still make its original wholesale offering Dew and Celtic brand Heritage available to these shops. “The lower-priced lines we’ll target at gift shops, but those pieces with a higher level of design we’ll call Kit Heath and target at jewellers,” he says. “The original success of Kit Heath came from these lines and there is still a place for them.”

The reaction to this move from the gift end of the market has not been favourable. “Some retailers are still getting over it and I’m sorry about that,” says Lancaster. “There was a feeling of why change something that’s working but I had to look ahead and you want to be associated with retailers that offer something positive to your brand.”

Kit Heath has made some headway with the repositioning strategy, taking on 100 new mid- to high-end jewellers in the past 12 months.

As well as the decluttering of its stockist list, Lancaster feels that the high price of gold has helped to boost the brand’s standing in the market. “Because of what has been happening in gold, jewellers have been left wanting for an entry-level silver brand,” he says.

To keep the momentum in retail stores going, Kit Heath is planning to get into one of the more controversial areas of jewellery retail – shop in shops. It hopes to get the first furniture installed in retailers’ stores in spring. “We will hopefully offer something compelling, something exciting; we’ll look to raise the bar,” reveals Lancaster. “There is demand for this so we’ll come up with something appealing.”

In the past jewellery brands have used shop in shops as a testing ground before opening standalone stores, so is this the plan for Kit Heath? The answer, Lancaster says, is categorically no. “I think you’ve got to stay focused on your strengths and ours is doing great collections, we’re not retailers,” he says firmly.

But a new area that Kit Heath is planning is a move into is gold-plated jewellery. The brand will launch its first 18ct gold plate collection at The Jewellery Show at Spring Fair this month. “It’s a great market opportunity; people are going for gold as a colour or just to be on trend,” says Lancaster. However, he insists that Kit Heath is and always will be silver brand.

Lancaster is optimistic for 2011. “We have at last got our foundations solid and next year is all about pushing forward,” he beams. Top of the list on Kit Heath’s list of New Year resolutions are to upgrade its internal IT system, trebling its supplier base and continuing to refresh its image. The brand made a striking start to the latter with a dreamy campaign shoot on location at Hartland Abbey, a location previously used by Mario Testino for a Vogue shoot.

As the restaurant empties and we wind up our conversation, Lancaster returns to talking about his love of travelling and his preferred tactics. “My instinct is to get off the beaten track and push the boundaries and that’s when exciting things happen,” he says.

Lancaster has certainly taken Kit Heath off its beaten track by introducing new collections and applying business acumen to a creative company, and he’s pushed boundaries by having the courage to strip away retail accounts in order to strengthen the brand. While he talks of his dreams of slinging on his backpack once again, it seems for now Lancaster is having his own little domestic adventure at Kit Heath.